On January 3, 2019, the United States Bankruptcy Court for the Northern District of Illinois entered a damage award in favor of Vedder Price client TRG Venture Two, LLC (TRG) in the amount of $9,500,000. Shareholders Douglas J. Lipke and William W. Thorsness acted as bankruptcy counsel and co-trial counsel with Pretzel & Stouffer’s Ed Ruff and Mike Turiello. The 4-day trial yielded one of the largest contempt awards for violation of a Bankruptcy Court injunction order ever in the country.

The award is against The Fidelity and Deposit Company of Maryland (F&D). In 2017, Bankruptcy Judge Timothy A. Barnes ruled that F&D violated the injunction by improperly suing TRG in state court after TRG bought property from the Kimball Hill bankruptcy trust. The court found that TRG suffered actual and compensatory damages as a result of F&D’s pursuit of litigation that violated its previous orders.

“We are pleased that the court found in TRG’s favor and I commend the hard work put forth by both co-counsels and TRG during the preparation and subsequent 4-day trial,” said Mr. Thorsness. Mr. Lipke continued, “We are proud of our relationship with TRG and congratulate them on this victory. This decision underscores the capabilities of our Bankruptcy and Litigation practices to deliver effective counsel to our clients.”

Aviation is one of the most heavily regulated industries in the United States. Thousands of complex Federal Aviation Regulations (“FARs”) exist governing the operation, ownership and maintenance of aircraft. This article is an analysis of the consequences of alleged FAR violations. Specifically, the Federal Aviation Administration (the “FAA”) alleged that the Hinman Company (“Hinman”) was operating as a de facto charter air carrier for compensation without the required FAA approvals and as a result, the FAA proposed a $3.3 million civil penalty against Hinman for the related FAR violations.

In this article, Shareholder David M. Hernandez provides an analysis of circumstances that gave rise to Hinman’s $3.3 million proposed civil penalty, the FAA’s case, and the FAA’s subsequent referral to the U.S. Attorney’s Office for the Western District of Michigan with the primary goal of educating companies on how to avoid being the next seven-figure civil penalty enforcement action.

Vedder Price is pleased to announce that Global Transportation Finance Shareholder Francis X. Nolan, III has been named as one of the Top 10 Maritime Lawyers globally as part of Lloyd’s List’s “2018 Top 100 Most Influential People in Shipping” series. Lloyd’s List has been an authority on maritime news since 1734. He is one of only three Americans named.

Lloyd’s List cited Mr. Nolan’s “reputation as a leading maritime finance attorney” and his election as President of the Maritime Law Association of the United States in 2018 as well as his “work this year in drafting changes to Liberia’s maritime laws, to allow those who hold title to vessels in lease structures to record their bareboat or demise charter as preferred mortgages.”

To read the entire list, please click here.

Vedder Price is pleased to announce that it advised DLL in its closing of DLL 2018-2, an equipment securitization transaction involving the issuance of more than $1 billion of asset-backed notes. This is one of the largest equipment securitization transactions in the recent history of the U.S. market.

According to DLL’s press release, the notes are backed by a pool of loans, leases and other financing solutions with respect to copiers, printers, networking and office equipment originated by De Lage Landen Financial Services in the U.S. The transaction includes four senior classes of $225.0 million class A1 notes, $349.0 million class A2 notes, $349.0 million class A3 notes, and $100.610 million class A4 notes rated P-1/A-1+ and Aaa/AAA by Moody’s Investors Service and Standard & Poor’s Ratings Services, respectively, and three subordinated classes, which were also rated by the same rating agencies and retained by DLL.

Global Transportation Finance Shareholder Edward K. Gross, Capital Markets Shareholder Marc L. Klyman and Tax Shareholder Matthew P. Larvick led the team from Vedder Price. The team also included associates Melissa W. Kopit, Erich P. Dylus and Jonathan M. Rauch.

“We were pleased to partner with DLL again on such a monumental securitization transaction,” said Mr. Gross. “The success of their inaugural U.S. securitization in 2017 secured their place in the market, and this deal further demonstrates their commitment to growth. We are proud to represent them now and as they pursue further transactions in the future.”

Aviation is one of the most heavily regulated industries in the United States. Thousands of complex Federal Aviation Regulations (“FARs”) exist governing the operation, ownership and maintenance of aircraft. This article is an analysis of the consequences of alleged FAR violations. Specifically, the Federal Aviation Administration (the “FAA”) alleged that the Hinman Company (“Hinman”) was operating as a de facto charter air carrier for compensation without the required FAA approvals and as a result, the FAA proposed a $3.3 million civil penalty against Hinman for the related FAR violations.

In this article, Shareholder David M. Hernandez provides an analysis of circumstances that gave rise to Hinman’s $3.3 million proposed civil penalty, the FAA’s case, and the FAA’s subsequent referral to the U.S. Attorney’s Office for the Western District of Michigan with the primary goal of educating companies on how to avoid being the next seven-figure civil penalty enforcement action.

In this issue

New Rules, Proposed Rules, Guidance and Alerts

• OCIE Announces Risk-Based Sweep Exam of Funds, ETFs and Advisers
• OCIE Issues Risk Alert on the Cash Solicitation Rule
• SEC Staff No-Action Letter Allows Fund Boards to Rely on CCO Representations for Affiliated Transactions
• Insurance Companies Obtain Relief to Use Statutory Financial Statements in Registration Statements Filed on Form S-1 for Certain Insurance Products

 

Public Statements, Press Releases and Testimony

• Recent Remarks by Dalia Blass, Director of the SEC’s Division of Investment Management, at Industry Conferences
• SEC Issues New Strategic Plan for Fiscal Years 2018–2022

 

Litigation and Enforcement Actions and Initiatives

• District Court Grants Summary Judgment in Section 36(b) “Manager-of-Managers” Excessive Fee Suit

 

Download the Regulatory Update below.  

Charles J. Nerko, a member of Vedder Price’s Complex Commercial Litigation group, will be a featured speaker at the On Ramp to the Profession Program, hosted by the New York City Bar’s New Lawyer Enrichment Program. Mr. Nerko, who has been selected to the New York Metro Rising Stars List by Super Lawyers magazine for the past four years, will advise new lawyers on communication, professionalism, and trial advocacy.

The New Lawyer Enrichment Program is sponsored by sixteen New York area law schools and offers continuing legal education courses that equip new lawyers with the practical skills and substantive knowledge they need to be successful in the legal profession.

To learn more about the New Lawyer Enrichment Program, please click here.

Shareholders Edward K. Gross and David M. Hernandez will present at the Corporate Jet Investor (CJI) conference on January 28 and 29 in London. CJI London brings together senior level financiers, brokers, arrangers, lawyers, manufacturers, operators, appraisers and many others active in business jet transactions. Vedder Price will also serve as a lead sponsor of the event.

Mr. Hernandez will moderate the session, “Do owners value safety oversight?”. In this discussion, panelists will cover the roles and responsibilities of registries and owners in making aviation safer.

Mr. Gross will moderate the session, “Has Cape Town made a difference?” on January 29. He and his panelists will discuss the intended benefits and practical implications of the Treaty, and the extent to which it encourages or discourages investment or financing by corporate aircraft lessors, lenders and investors. To learn more about this conference, please click here.

Mr. Gross will then attend the Helicopter Investor Conference on January 30, where he will moderate the “Financing rotary assets” panel, touching on a variety of topics including the current market sentiment regarding helicopter financing and the funding sources participating in those transactions.  To learn more about this conference, please click here.